Hearing scheduled for AG’s subprime lawsuit

Attorney General Martha Coakley’s office issued a press release today that should interest those following the troubling subprime mortgage development crisis.

Coakely announced that her office has filed a lawsuit in Suffolk Superior Court against Option One Mortgage Corp., a subprime lender that originated thousands of loans in Massachusetts. Its parent company is one that is familiar to many: H&R Block.

Sources say that a preliminary injunction hearing has been scheduled on June 16 at 2 p.m. The case will be heard by Superior Court Judge Ralph D. Gants in the Business Litigation Session.

The complaint alleges that Option One and H&R Block engaged in unfair and deceptive conduct on a broad scale by selling what was described as “extremely risky loan products that the companies knew or should have known were destined to fail to Massachusetts consumers.”

As seen in related stories, the complaint also alleges that the companies discriminated against black and Latino borrowers in Massachusetts by charging them higher points and fees to close their loans than similarly situated white borrowers. It also claims that black and Latino consumers were targeted with marketing that pushed the sale of predatory loan products.